Press Releases

Posted on March 6, 2017

WASHINGTON – Sen. Ron Johnson (R-Wis.), chairman of the Senate Homeland Security and Governmental Affairs Committee and Sen. Lamar Alexander (R-Tenn.), chairman of the Senate Committee on Health, Education, Labor, and Pensions, applauded the passage of a resolution which would block implementation of the Obama administration’s flawed and burdensome “blacklisting” rule through the Congressional Review Act.

“Overturning this harmful rule will reduce the regulatory burden plaguing our economy,” said Chairman Johnson. “This rule could potentially be used to blackmail innocent businesses during labor negotiations. The Obama administration admitted that this rule would cost at least $398 million each year to comply with, but failed to quantify any benefit whatsoever. Repealing this rule is a step in the right direction by providing the regulatory relief that is necessary to unleash the American economy so that it can realize its full potential.”

“The Senate today did the right thing by overturning the harmful Obama Administration ‘blacklisting’ regulation that could have prevented our nation’s federal contractors from receiving a federal contract for an alleged labor violation before any wrongdoing has been proven. I’m urging President Trump to sign this legislation as soon as possible,” said Chairman Alexander.

The rule would make a system designed to protect workers less efficient, undermine our nation’s military readiness, and limit the ability of small businesses to compete for federal contracts.

Background

In 2014, former President Obama signed Executive Order 13673, adding a new layer of bureaucracy onto a federal procurement system already plagued by delays and inefficiencies. The executive order directed federal agencies to change the procurement regulations. The resulting “blacklisting” rule requires employers bidding on federal contracts to disclose violations and alleged violations of 14 different federal labor laws and similar state labor laws. Employers would also be required to determine a subcontractors’ or suppliers’ compliance with complex labor laws. The rule, which is currently blocked by a preliminary injunction, is fatally flawed:

The blacklisting rule violates due process and holds federal agencies to a different, lesser standard. The executive order empowers agencies to deny contracts for “alleged” violations of various federal labor laws, setting a startling precedent that employers are guilty until proven innocent.

The blacklisting rule threatens the vital resources the Armed Forces need to defend the homeland and keep Americans safe. According to the Professional Services Council, the executive order will “slow the [Department of Defense] acquisition process and harm the Department’s ability to meet its mission.”

The best way to ensure fair pay and safe workplaces is to enforce existing suspension and debarment rules. In 2014, federal agencies issued more than 1,000 suspensions and nearly 2,000 debarments to employers bidding on federal contracts—including 400 suspensions and 735 debarment actions by the Department of Defense.

Under the Congressional Review Act, Congress may pass a resolution of disapproval to prevent, with the full force of the law, a federal agency from implementing a rule or issuing a substantially similar rule without congressional authorization. The resolution would block the “blacklisting” rule from taking effect and prevent future administrations from promulgating a similar rule.